Unlocked vs Locked Advice (I'm really lost)

I'm looking at the HTC One S. I went to T-Mobile's store and they want $650 after tax for it without contract. 1) Does without contract mean unlocked?2) Unlocked means I could take it onto any supported GSM network, correct?3) Is the locking a hardware or software type thing? Could installing a custom ROM get past it?4) I see on ebay and amazon sellers that have it at ~$450 new in box phones "without contract". Is there some gotcha to me going this way? I'm wondering how they have the phone new and cheaper than T-Mobile.Example: http://www.ebay.com/itm/BRAND-NEW-HTC-O ... 191wt_1027

Sorry if any of this is elementary, I tried to research it as best I could and ended up mostly confused. Thanks for the help.

Its basically discounted because its not coming from T-Mobile. I'm sure quite a few of them are bought on contract and then never opened, and unloaded on ebay. These then drive down the prices for other listings, which may be phones from the wholesale channels.

Its basically discounted because its not coming from T-Mobile. I'm sure quite a few of them are bought on contract and then never opened, and unloaded on ebay. These then drive down the prices for other listings, which may be phones from the wholesale channels.

There'd be no profit in it for T-Mobile, though - if anything, unless they're really ancient phones, it should be the opposite.

In general, the deal is :

Mobile phone providers agree to buy hundreds of thousands of phones from e.g. Samsung or HTC. It's enough of a business opportunity that Samsung/HTC will agree to write (or the provider supplies) a custom firmware for the device, branding it as e.g. from T-Mobile or whoever, with any apps etc. pre-loaded on the device. Once this software/firmware (at this point, it doesn't really matter whether it's soft- or firmware) is loaded on the phone at the factory, the phone will only accept SIM cards coded for the provider's network. It is almost always possible to wipe & reset the phone back to a stock firmware which will unlock it, although it's usually not an entirely straightforward process.

The mobile provider then sells that device at a very substantial discount because they're going to lock you into a contract for 1-2 years, and they'll get the full retail value of the phone + profits out of your monthly bills for the duration of the contract. If you buy an unlocked phone from e.g. Amazon, you'll see it costs a hell of a lot more than buying directly from the provider, or buying it directly from the provider without a contract as you've seen from the T-Mobile HTC One S.

Basically, it costs providers almost nothing for actual use of their network, which is often why they'll offer you loads of free minutes, texts & data to keep you as a customer. Their profits mostly go into maintenance & upkeep of the network, not the use of it.

Its basically discounted because its not coming from T-Mobile. I'm sure quite a few of them are bought on contract and then never opened, and unloaded on ebay. These then drive down the prices for other listings, which may be phones from the wholesale channels.

Does this have any lasting impact on the phone? By which I mean is the phone marked as being opened subsidized and will I run into problems trying to get on the prepaid plan? Or is this just a breach of contract on the original buyer?

Given how poorly the One line performs in the US with ICS and running tasks, I'd probably consider that over the One. Plus you'd save some dough.

I haven't seen it in person. The plastic turned me off. I know it has a replaceable battery, takes SD expansion cards, etc. I know as a tech guy I should want it, but I really just want a phone that looks good.

Its basically discounted because its not coming from T-Mobile. I'm sure quite a few of them are bought on contract and then never opened, and unloaded on ebay. These then drive down the prices for other listings, which may be phones from the wholesale channels.

Does this have any lasting impact on the phone? By which I mean is the phone marked as being opened subsidized and will I run into problems trying to get on the prepaid plan? Or is this just a breach of contract on the original buyer?

Not for T-Mobile. There are some issues with Verizon and Page Plus, but not for T-Mobile (or AT&T IIRC).

ChrisG:

You're correct on most of the points you touched upon, but I'd like to clarify a few things:

1. It is impossible in most cases to "revert" to a stock OEM firmware. In most cases these days, the hardware itself is different, or the firmware is coded so that it won't install onto a device from a different region. Same with SIM locks.

2. The MSRP of the branded phone may be similar to the MSRP of the unlocked, unsubsidized phone, but the contract makes it cheaper. The clearest example is the iPhone, since most other phones aren't sold both unbranded and branded in the US. The wholesale channel that I was talking about includes phones sold to dealers and third-parties. It is a mystery what T-Mobile pays to HTC for each One S, and dealer rebates and discounts also vary greatly.

You're correct on most of the points you touched upon, but I'd like to clarify a few things:

1. It is impossible in most cases to "revert" to a stock OEM firmware. In most cases these days, the hardware itself is different, or the firmware is coded so that it won't install onto a device from a different region. Same with SIM locks.

2. The MSRP of the branded phone may be similar to the MSRP of the unlocked, unsubsidized phone, but the contract makes it cheaper. The clearest example is the iPhone, since most other phones aren't sold both unbranded and branded in the US. The wholesale channel that I was talking about includes phones sold to dealers and third-parties. It is a mystery what T-Mobile pays to HTC for each One S, and dealer rebates and discounts also vary greatly.

1. As for unlocking, I suppose it depends a lot on the phone itself. I did it with my GS1; originally a contract phone when I worked in Ireland from a provider that doesn't exist in the UK; it was a hassle and took a guy in a shop a couple of days, but he managed it - reverting it to Froyo in the process, which I then had to re-flash to Gingerbread myself. So as I said, it's usually doable, but not straightforward. Or once unlocked, I could've gone for Cyanogen for it.

2. That was what I was trying to convey; contracts make phones cheaper, and that's largely where carriers make their money. They undoubtedly get very large discounts from the manufacturers, but exactly how much is a mystery - enough for it to be worth their while, anyway.

As a consumer, I once figured out that with a relatively cheap SIM-only plan (£11/$15 a month), buying an unlocked, new, top-of the-line phone works out to be marginally (say £70-100) cheaper than buying the same phone on a contract over 2 years. And in the UK, providers are increasingly moving towards 18-24 month contracts for higher-end devices.

Yeah, its completely dependent on the phone. For example, my AT&T HTC Titan can't be flashed with the unbranded firmware (unless someone unlocks the HSPL) and it is an exception in that it has different firmwares available to flash, and my Motorola Photon (and most other phones I've owned) doesn't even have an unbranded version.

If you have something like the T-Mobile HTC One S, I wouldn't be surprised if it doesn't even exist in unbranded form since the hardware of the unbranded version is different at the chipset level. Its possible to unlock the bootloader and load a custom ROM and its possible to SIM unlock it, but there's no straightforward process to just flash an unbranded file and have the SIM unlock and firmware change happen at once.